Kentucky resident Billi Jo Woods and her legal team have initiated a class action against the owners and founder of the illegal offshore gambling site Bovada, claiming damages under the state’s Loss Recovery Act (LRA). A similar suit by the state itself against PokerStars resulted in a $300 million settlement. That came after a lower court had initially issued a $1.3 billion judgment against the site and its owner, Flutter.

Bovada is an offshoot of Bodog, a multi-headed offshore gambling giant. Bodog was founded by the reclusive billionaire Calvin Ayre, who is among the defendants. Ayre claims to have left the gambling world in 2009, though his website CalvinAyre.com was an outlet for gambling news until 2021, when it pivoted to focus on cryptocurrency.

Although initially a single site, Bodog has split its operations up and undergone some convoluted corporate restructuring over the years. This makes it hard to connect the dots between its various activities, perhaps intentionally.

For instance, Bodog’s poker arm was sold to the previously almost unheard-of Ignition Casino in 2016. That was then sold to a Hong Kong investment group called PaiWangLuo the following year.

Bovada.lv, which continues to serve American customers in a black market capacity, is the main focus of the lawsuit. As well as accusing it of conducting illegal gambling, Woods’ complaint alleges that it misleads Kentucky residents by falsely advertising itself as legal.

Offshore sites employ a number of tricks to present themselves as legal and rank highly in Google’s search algorithms, often with help from mainstream media.

Who are the Defendants in the Bovada Class Action?

Per the complaint, the current owner of the Bovada.lv domain is Morris Mohawk Gaming Group (MMGG), the primary defendant in the case. Besides Ayre, the other co-defendants are MMGG owner Alwyn Morris and Harp Media BV. 

Morris is a former Canadian Olympic kayaker and member of the Mohawks of Kahnawà:ke First Nation. At one time, Bodog and Bovada were regulated by the Kahnawà:ke Gaming Commission, but it has ceased working with sites that serve unregulated states or other black markets. Now, the various parts of the Bodog Network operate in rubber stamp jurisdictions like Curaçao and Antigua and Barbuda.

The suit alleges that Curaçao-based Harp Media has an ownership interest in Bovada and collects a portion of its revenue.

What’s the Kentucky Loss Recovery Act?

The LRA allows any person in Kentucky to sue for up to three times the amount lost during illegal gambling, even if they were not themselves a participant. It was a factor in the recent Virtual Gaming Worlds class action settlement in Kentucky, as well as with PokerStars.

In the PokerStars case, the state claimed to be suing on behalf of all its residents who had played on PokerStars between 2006 and 2011, when the Department of Justice cracked down on the offshore online poker industry. Here, Woods is suing on her own behalf and inviting all other Bovada players in the state to join her.

The vast sum awarded in the PokerStars case is likely part of the motivation for Woods’ suit. The Kentucky court agreed with the state’s assessment that “losses” means gross losses without regard to winnings. Thus, if one poker player lost $10 to another but then won it back, each player would be considered to have “lost” $10 despite having broken even. As a result, the judgment against PokerStars was based on losses many times greater than any revenue it had ever made in the state, even before tripling the damages.

Differences Between the Bovada and PokerStars Suits

Assuming they receive class certification, Woods and her co-plaintiffs have some hurdles ahead.

For one thing, the PokerStars case played out in state courts, while this will be a federal case. Woods’ team filed their complaint with the US District Court for the Eastern District of Kentucky due to diversity jurisdiction. That is, they were able to make it a federal case because it involves individual defendants who aren’t Kentucky residents.

Where state courts have set a precedent, the federal court should follow it. For instance, the state court’s way of calculating losses is likely to apply. In any novel issues, however, a federal court may view this situation differently than a state court would have.

However, the biggest challenge of all may be to get the proceedings started in the first place. None of the defendants is in the US:

• Morris and his company are based in a sovereign First Nation within the borders of Canada.
• Harp Media is a Curaçaoan company.
• Calvin Ayre is a Canadian citizen, most recently known to have resided in Antigua and Barbuda.

One or more may attempt to persuade the court to dismiss the case without appearing. Failing that, if none elects to show up, the case can’t proceed without a good-faith effort to locate them, which could take a year. After that, the plaintiffs could file for a default judgment, but collecting on it would be just as difficult. There would need to be a separate legal effort to seize the defendants’ assets, assuming the plaintiffs can locate any assets to seize.